Although the Cambodia-China Free Trade Agreement (CCFTA) has been signed and is set to liberalise the agricultural market and clear significant barriers on certain tariff lines, trading appreciably more agricultural wares will not be possible without first tackling some of the remaining non-tariff barriers, especially those concerning sanitary and phytosanitary (SPS) rules, according to the agriculture minister.
Minister of Agriculture, Forestry and Fisheries Veng Sakhon on October 18 explained that the CCFTA would provide duty free access to the Chinese market for a wide range of Cambodian agricultural commodities.
However, he said, agricultural exports must meet SPS and food safety standards outlined by Chinese laws and regulations. Similarly, imports must conform to the Kingdom’s legal SPS rules.
He explained that the World Trade Organisation (WTO) SPS Agreement reaffirms the rights of Cambodia and China, as member states of the UN agency, to adopt the SPS and food safety standards deemed necessary for imports, and enforce them to prevent potential risks to the health and lives of the people, animals and plants in their territories.
Cambodia last year exported 17 types of agricultural products to China, amounting to more than 736,000 tonnes, the minister said, adding that these sales were possible due to respective protocols signed between the two countries.
He listed notable exports as fresh bananas, fresh and dried mangoes, milled rice, cassava chips, tapioca starch, rubber, cashew nuts and coconut oil.
To take full advantage of the opportunities created by the free trade agreement (FTA), Sakhon asked farmers, processors and other private sector stakeholders in the agricultural value chain to work with the government to secure investment in the necessary infrastructure for processing, packaging and exporting that is compliant with the quality, safety and SPS standards of China.
With a reported population of more than 1.4 billion, the Chinese market has the highest demand potential for Cambodian agricultural produce, the minister emphasised.
“Therefore, Cambodia must strengthen [and maintain] its competitive edge in the Chinese market by ramping up its quality, safety and SPS standards to reap the maximum benefits from the FTA framework … and expand export markets to other destinations,” Sakhon said.
Asian Vision Institute (AVI) economic analyst Chheng Kimlong told The Post on October 19 that even with the CCFTA in effect, Cambodian businesses cannot begin shipping agricultural goods directly to China before a series of field inspections are conducted, in accordance with common standards and special agreements, particularly those concerning SPS.
Kimlong noted that the agriculture, commerce and other relevant ministries over the years have successfully negotiated better terms on quality, SPS and other standards for various commodities with the Chinese side, which significantly differ between items.
“We have to deal with it on a case-by-case basis. Milled rice, corn, Faboideae legumes and bananas, for example are generally in line with Chinese standards, which differ from the EU’s,” he said.
He argued that all-round participation from both governments and countries, deeper trade ties among their private sectors, and increased Chinese investment in the Kingdom would be required to pump up Cambodian agricultural exports to China.
Royal Academy of Cambodia economics researcher Ky Sereyvath pointed out that while the CCFTA would allow for the export of larger quantities of local agricultural products to China, supplementary agreements related to SPS standards remain imperative.
However, he stressed, the use of harmful fertilisers and unsanctioned techniques in the supply chain persist as hindrances to efforts to export Cambodian agricultural merchandise to China.